Amendments are proposed to be made to the NSW Duties Act, 1997 to overcome the NSW Supreme Court decision in CTI Joint Venture Company Pty Ltd v Chief Commissioner of State Revenue that held that a nomination deed in relation to the exercise a call option was done by way of novation and therefore was not a transfer of any dutiable property that could be subject to stamp duty.
The effect of these amendments is that a transfer of an option to purchase land is taken to occur if for valuation consideration:
- the option holder nominates another person to exercise the option
- the option holder nominates another person as purchaser or transferee of the land the subject of the option on or before the exercise of the option
- the option holder agrees to a novation of the option, or
- the option holder otherwise relinquishes his or her rights under the option, so that another person obtains a right to purchase the land.